Do Rural Areas Need Government Broadband?
Wednesday, February 13th, 2008 By Marc KilmerWith all the discussion about Governor Strickland’s bond (read: higher taxes down the line) proposal for “economic stimulus,” I’m hesitant to bring up the fact that California is considering issuing bonds to fund deployment of broadband throughout the state. It’s a horrible idea, as Steve Titch points out at the Reason Foundatin’s blog, but when has that stopped a politician from embracing a proposal? As Steve says:
This may be heresy, but there is no “right” to fiber. Living in rural areas has trade-offs. Fresh air, cheap real estate and elbow room are great and I bet you can still get a good cup of coffee in town, it just may not be Starbucks or Seattle’s Best (and some think that’s a good idea). Companies like Zayo Bandwidth and Bend Broadband are showing that commercial carriers can reach rural customers. California should let them and others go for it rather than funnel subsidies to technologies that are costly and inefficient for the purpose.
There are two points here that need to be brought out more often. First off, if you choose to live in a rural area, going without certain things is par for the course. I grew up in a very rural area and we lacked quite a few things people in cities, suburbs, and small towns take for granted. Our road wasn’t paved, we didn’t have the option of cable TV, we had no store other than a gas station in our town, etc. Many people choose to leave rural areas because they do not like the tradeoffs. Many others choose to live there because of them, though. Broadband is certainly nice to have, but it’s not a tragedy if you lack it.
Secondly, giving subsidies to certain broadband carriers to expand in these areas distorts the market. For example, in the early days of the Internet, dial-up was state-of-the-art. Had the government subsidized dial-up service it is likely that the deployment of broadband would have been severely hampered. Furthermore, dial-up service availability is pretty much universal now. Had this service been subsidized it would have merely been giving money to companies to do something they would have done without taxpayer money.
The Internet is a very new tool. Thirteen years ago most people had little idea about websites or e-mail. Telecom companies have done a very good job in meeting the desires of consumers for high-speed ways to connect to the Internet during this time. Given both freedom from stifling government regulations and market-distorting subsidies, it’s likely that even people in rural areas will have high-speed Internet access at some point. It’s always tempting for politicians to “do something” about the various “crises” that pop up. It’s usually wiser for them to just sit back and let businesses and consumers work it out for themselves.
Tags: Telecom
